Is Amazon about to change the way retail stores operate?

Is Amazon about to change the way retail stores operate?

September 2, 2018

If you haven’t heard this yet, hold on to your cash, because over the next few years retail stores just might go through a metamorphosis thanks to Amazon.

This past week Amazon opened their third cashierless convenience store in downtown Seattle, just a week after they opened their 1,450 square foot second store, also in Seattle.

The stores, called Amazon Go, are centrally located within a couple of miles of Amazon’s Seattle campus. The new store, at 2,100 square feet, is their biggest store thus far and it is a checkout-free model, which Amazon first revealed to the public in January, after more than a year of fine-tuning the concept by allowing only employees to shop there.

It appears Amazon has figured out how to replicate their technology as this location wasn’t subjected to the same rigorous employee testing as the previous two stores and on day one was open to the public.

The stores rely heavily on the Amazon Go smartphone app. Customers scan a unique QR code within the app before passing through a set of glass doors, similar to how many companies use access control technology when entering office buildings or ATM vestibules with an access card. A vast array of overhead cameras and weight sensors in the shelves automatically track what people pick up and take from the store.

When customers leave the store, they can just walk outside, passing another sensor in the process. Amazon Go’s systems automatically debit their accounts for the items they take, sending the receipt to the app. By logging in shoppers at the entrance, then tracking their actions in the store, the system eliminates the need for traditional checkout registers and checkout workers along with them.

However, the stores are not employee-less. There are plenty of Amazon employees in the store to help customers find items, restock shelves, answer questions, etc.

The three small stores, which sell prepared deli items as well as quick groceries, are Amazon’s latest dive into the world of retail. They have had their own branded bookstores and last year they acquired Whole Foods.

While Bloomberg News says Amazon plans to open as many as 3,000 of its cashierless stores by the year 2021, the company has been mostly quiet about its plans, saying only that future locations are planned for Chicago and San Francisco. Earlier this year, the technology industry trade publication Recode reported that Amazon plans to open as many as six additional Amazon Go stores in Seattle.

When they first opened, the Amazon Go stores drew massive lines, similar to how Apple stores attract large lines when buyers clamor for the new iPhones. The store has a 4.5-star rating on Yelp, with customers raving about the concept.

Once the concept gets flushed out and proves to be successful, we can expect to see other types of cashierless-only stores popup with perhaps some of the big box stores like Target or chains in the grocery industry leading the way, as many already utilize self-service checkout lines.